industrial

Hungary, Uzbekistan to set up special industrial zone for Hungarian firms near Tashkent

Szijjártó Péter, Uzbekistan

Hungary and Uzbekistan have agreed to set up a special industrial zone tailored to the needs of Hungarian businesses near Tashkent, Péter Szijjártó, the minister of foreign affairs and trade, said in the Uzbek capital on Thursday.

Hungarian firms will have a special legal status to carry out investments and business activities in the area, Szijjártó said, according to a foreign ministry statement.

Detailing his talks in Uzbekistan, Szijjártó said Hungary’s OTP Bank recently acquired Uzbek peer Ipoteka Bank. The minister added that OTP’s entry into a given market tended to encourage more investments in that market by Hungarian businesses.

“This is only natural, given that such a step guarantees a form of legal and financial security for their investments,” Szijjártó said. This is once again the case, he said, noting that eight Hungarian companies have announced plans to invest in Uzbekistan’s food industry, agriculture, nuclear industry, pharmaceutical industry, the production of medical equipment and the construction industry since OTP established a presence in the country.

The ability of Hungarian businesses to invest in foreign markets and reinvest their profits in Hungary is key to the country’s future economic growth, Szijjártó said.

The government therefore supports Hungarian investments in the fast-expanding market that is Uzbekistan, he added.

Meanwhile, Szijjártó said both central Europe and central Asia were suffering from the effects of the war in Ukraine. Both Uzbekistan and Hungary want the war to be over and peace to be established as soon as possible, he added.

“International decisions that risk prolonging or — God forbid — expanding the war go deeply against our national interests,” Szijjártó said.

Weapons deliveries contribute to the prolongation of the war and carry a risk of escalation, he said, adding that both Budapest and Tashkent supported an urgent ceasefire and peace talks.

Szijjártó met Uzbekistan’s deputy prime minister, foreign, economic and investment ministers as well as top officials of the presidential administration, among others, during his visit.

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Boysen Group to create 400 new jobs in Hungary

boysen group

The Boysen Group is creating 400 new jobs in Nyíregyháza, in eastern Hungary, with a 60 billion forint (EUR 150 million) investment that will turn out parts for electric cars supplying BMW’s Debrecen plant, Péter Szijjártó, the foreign and trade minister, said on Monday.

The new factory which is receiving state support of 5.6 billion forints will make extensive use of renewable energy, according to a ministry statement.

Szijjártó said that what was certain in an uncertain world was the rise of electric cars.

He said the rise of this industry had been the outcome of a political decision as much as a business matter, and the European Union has played a big role accordingly, partly in its aim to reduce pollution and meet its climate change goals.

The minister said it was bizarre when politicians who professed to be green campaigned against the electric car industry, “trying to create confusion and mischief”.

He said competition for such investments was heating up. “So whoever attracts investments may be able to avoid recession and mass unemployment,” he added.

Szijjártó noted that all three premium German car manufacturers saw Hungary as a key location of their electromobility strategy, and now many suppliers from the East were attracted to the country.

Hungary is the world’s third biggest producer of batteries, and he dismissed claims that it was dangerous to set up plants here.

“I’d draw their attention to the fact that huge electric battery factories already operate in Hungary,”

he said, adding that there was no sign of the deleterious impact that some opposition politicians were trying to make people believe.

The minister said that in the past 8 years, fully 183 large German investments have been implemented in Hungary. Further, after a 13 percent increase last year, bilateral trade reached a peak again, its volume worth 56 billion euros by the end of October, he said.

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Turkish Industry Technology Varank held talks in Budapest

Minister of Economic Development Márton Nagy held talks with Turkey’s Minister of Industry and Technology Mustafa Varank in Budapest on Monday, the ministry said.

The sides were in agreement about the importance of Turkish-Hungarian economic links and industrial cooperation, the statement said.

Nagy said that in an economic environment burdened by war and sanctions, efforts must be made to maintain sensible and respectful cooperation. Economic cooperation between Turkey and Hungary is flourishing and bilateral trade is at an unprecedented level, he added. Records show that exports grew by 17 percent in the first ten months of last year, he said.

The intensity of Turkish-Hungarian links is demonstrated by the fact that nearly 100 Turkish companies employ nearly 2,000 people in Hungary and several hundred more jobs are planned to be created thanks to future Turkish investments, the ministry said.

The ministers said talks would continue on economic cooperation, with plans to further enhance links especially in fishing, health industry and pharmaceuticals, food industry, tourism and energy, the ministry added.

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Investment volume in Hungary rose by an annual 7.7 percent

penny

Investment volume in Hungary rose by an annual 7.7 percent in the third quarter, edging down from a 7.8 percent annual increase in Q2, the Central Statistical Office (KSH) said on Monday.

KSH said the increase in investments can be explained by the dynamic activity of households and businesses and decreasing investments from the government. Developments in the manufacturing industry, the energy sector as well as housing construction increased, while investments related to transport, storage and agriculture held back economic performance.

Corporate investment climbed by 10.3 percent, picking up from a 3.0 percent increase in the previous quarter, helped by developments of foreign-owned companies. Public sector investment fell by 10.5 percent after growing by 3.0 percent year-on-year in the second quarter, as central government investments decreased significantly but local governments slightly increased their purchases of fixed assets, KSH said.

In the 3rd quarter of 2022 compared to the same period of the previous year:

  • The volume of investment activity increased by 7.7%. Within it, construction investments representing almost two-thirdsof the performance value of investments increased by 10%, investments in machinery and equipment, accounting for more than one-third of investments grew by 3.3%. Within machinery investments, the volume of imported machinery grew, while that of domestically produced ones decreased.
  • Among enterprises with at least 50 employees, accounting for 56% of investment output, the volume of developments grew significantly,by 10, where developments of foreign-owned enterprises played a prominent role. At the same time at budgetary units, which accounted for 11% of investments, the performance dropped by about one-tenth. While central government bodies saw their developments decreasing significantly, purchases of fixed assets by local governments slightly increased. Investment volume at other categories (enterprises with fewer than 50 employees, private entrepreneurs, non-profit enterprises as well as households) grew by 9.5%.
  • Volume changes in investments over the reference period differed between sectors. Developments in manufacturing, representing the largest proportion (30%) of developments in the national economy, increased greatly (by 31%) in the third quarter, thus this area significantly supported the increase in the volume of investments. This was primarily due to the high-volume projects started in the previous periods in the field of electrical equipment manufacturing, but the revival of investments in vehicle production also played a role in the growth. Developments in the third major subsection, the manufacture of food products, also significantly exceeded the previous year’s value, in contrast , we measured a decrease in the production of basic metals and fabricated metal products.
  • Investment performance of real estate activities, the second largest investor, accounting for one-fifth of developments in the national economy, grew significantly, by 17%, primarily due to the large increase in dwelling constructions as well as property renovations, which represent, jointly, a decisive weight.
  • The decrease (-7.2%) typical of the previous quarter in the investment volume in transportation and storage continued, with the negative performance still mainly driven by a slowdown in public infrastructure developments.
  • In the field of wholesale and retail trade investments increased by 3.7%, due to the fact – among others – that enterprises operating in wholesale tradeincreased their investments.
  • After the significant expansion of the past quarters, the investment performance in agriculture, forestry and fishing decreased by 5.7% compared to the otherwise high base, wherethe the fact that larger companies dealing with stock-raising or crop production reduced their investment expenditure also played a role.
  • In the 6th largest weight representing the energy industry section investments increased greatly, by about 45%, primarily due to the higher expenditure of public investments in the reference period.
AVL technology centre inaugurated
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Hungary meeting point for Eastern, Western car industries

Szijjártó Péter Heves

Hungary is the meeting point for the Eastern and Western automotive industries, the minister of foreign affairs and trade said at the inauguration of South Korean chemicals company Chokwang Paint’s new plant in Heves, in eastern Hungary, on Thursday.

The plant will produce heat dissipation adhesives for batteries in electric vehicles, Péter Szijjártó said at the inauguration. The Hungarian government is supporting the HUF 3.8 billion (EUR 9.3m) investment with a HUF 380 million grant, he added.

AVL technology centre inaugurated
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The project will further strengthen Hungary’s role in the EV industry and boost capacities for battery production, Szijjártó said.

“Hungary is the European champion of the automotive sector’s transition to electric vehicles,” the minister said, adding that the EV industry was a determining factor in the Hungarian economy’s long-term future.

Szijjártó said that with Europe “heading towards a recession” because of the war in Ukraine and the related sanctions, reliable and strategic partnerships like the one between Hungary and South Korea were becoming even more important.

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Confirmed good news for Hungarian industrial sector

industrial sector Hungary car

Output of Hungary’s industrial sector rose by an annual unadjusted 11.3 percent in September, the Central Statistical Office (KSH) said in a second reading of data on Monday.

Adjusted for the number of working days of which there were two fewer in the base period, output increased by 11.6 percent, accelerating from 9.1 percent in the previous month, KSH said.

Output of the automotive industry, Hungary’s biggest manufacturing sector, rose by an annual 31.6 percent, albeit from a low base hit by the semiconductor shortage, KSH said. The automotive segment accounted for 25 percent of manufacturing sector output in September.

The detailed data show output of the computer, electronics and optical equipment segment, accounting for 11 percent of manufacturing, rose by an annual 21.5 percent.

Output of the food, drinks and tobacco segment, which made up 12 percent of manufacturing sector output, edged up by 1.4 percent as domestic sales moderated.

Output in the January-September period rose by an annual 6.7 percent.

Month on month, output went up a seasonally and working day-adjusted 1.6 percent.

As we wrote also today, despite the economic crisis, the performance of the construction sector in Hungary has increased, read details HERE.

Read alsoHungary is a battery power, but is it worth it?

Hungary is a battery power, but is it worth it?

As the need for electric vehicles grows, so does the demand for batteries. According to experts, by 2030 every second new car will be electric. Catching on with the new trend, the government plans to secure the country’s car production industry. The idea is great in theory, but there are several obstacles on the horizon. Will it be good for the economy if the aspirations come true?

There are two main problems with battery and electric car production. First, it requires less manpower than regular cars. Second, this market is very heavily ruled by just a few large conglomerates. Usually, large quantities of batteries are produced by a few large companies that also invest in the research and development of these technologies. Therefore, it is questionable whether Hungarian companies can even compete in this market.

The market on the production side is mostly ruled by one country, China. This country has an average share of 60-70 percent in production. The required materials are coming from different countries where these are mined, like Australia, Indonesia or the DRC. In Hungary, most production is primarily dominated by South Korean companies. Even though the Hungarian market is dominated by South Korea, new Chinese actors are on the way.

The role of Hungary

According to G7.hu, the total worth of investments was around EUR 5.3 billion which created about 13,800 job opportunities. The three biggest investments in the country, one by Samsung and two by SK, received HUF 138.6 billion (EUR 3.4 million) in state funding. This financed about 12 percent of the total cost of the investment. However, smaller endeavours also receive funding, which on average accounts for 10 percent of the costs. Of course, these investments require additional infrastructural upgrades in the surrounding area.

However, despite the effort, the newly settled companies usually bring their own suppliers. Hence, they are not reliant on Hungarian companies. Most of the hindrances stem from the lack of technological capabilities of the country and the small scale of the domestic market. There is no power in the hand of Hungary from a strategic perspective. As Hungary lacks the materials to have a strong chemical industry, the only way the country can have a larger stake in the more knowledge-intensive processes.

Hungary is only a superpower on the surface. First of all, statistics used present a false image as they overrepresent the role of Hungary. Secondly, the companies are just producing here, but they take no real part in Hungarian exports and the economy overall. The survival of the car production industry of the country is definitely a good point. But the road to success starts from development, not from production. Hungary needs to do its own research and development to be able to compete in this market. Nevertheless, this can mean a fast track for Hungary into a rapidly growing industry. However, for true success, more trust is needed in the innovative capabilities of domestic companies.

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Europe-China economic cooperation must remain unharmed

Szijjártó Battery Day

Hungary rejects all proposals that would fracture economic cooperation between the European Union and China, Foreign Minister Péter Szijjártó said in Budapest on Thursday, arguing that such a development would have a “tragic impact”.

Though the world is on the brink of a new era and there is a lot of uncertainty, what is certain is that the revolution of the auto industry is moving forward, the foreign ministry cited Szijjártó as saying at the second Hungarian Battery Day conference.

The auto industry accounts for 30 percent of Hungary’s economic output, Szijjártó said, adding that this presented the country with a lot of tasks but also “a huge opportunity”.

The minister said the European economy was “moving towards a big recession” and the Hungarian government’s goal was for Hungary to be a “local exception” to the economic downturn.

This, he said, required Hungary to attract as many investments as possible. He highlighted electromobility as an area with a lot of potential, noting that the government had supported 44 investment projects in this sector in the last five years.

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The Hungarian government has made it very clear since 2010 that its strategy is to be “the meeting point between Western and Eastern investors, the Western and Eastern economy”, he said.

Szijjártó noted that Hungary was the only country besides Germany and China to have plants from all three big German premium car makers. Hungary also has the third biggest electric battery production capacity in the world and ranks fifth in the export of EV batteries, he added.

Two of the world’s six leading battery makers have plants in Hungary, Szijjártó said, noting that Chinese battery maker CATL’s construction of a plant in Hungary was the biggest investment in the country to date.

The fact that the Hungarian economy has seen record investments both this year and the last shows that Hungary has remained a “local exception” to the recession, the minister said.

He said the rise in investments was a vindication of the government’s policy of opening up to the East.

Szijjártó praised Hungary’s investment environment, its low taxes, financial incentives and secure energy supply. The Hungarian government considers the latter a physical issue rather than an ideological or political one even though it “generates sometimes a pretty heated debate”, he added.

Concerning the negative effects of the war in Ukraine, Szijjártó said the ties between Russia and the European Union were being “cut one by one”. He said a similar trend needed to be avoided in the case of China.

Szijjártó said those who “are operating on a common-sense basis” would do everything in their power to reject political proposals that would destroy economic cooperation between Europe and China.

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Hungary’s industrial output grew by 14.4 percent year/year in August

Hungary-car-industry

The output of Hungary’s industrial sector rose by an annual unadjusted 14.4 percent in August, the Central Statistical Office (KSH) said in a second reading of data on Thursday.

Adjusted for the number of working days of which there were two fewer in the base period, output increased by 9.3 percent, accelerating from 6.6 percent in the previous month, KSH said.

Output of the automotive industry, Hungary’s biggest manufacturing sector, rose by an annual 58.0 percent, albeit from a low base hit by shutdowns, KSH said. The automotive segment accounted for 21 percent of manufacturing sector output in August.

The detailed data show output of the computer, electronics and optical equipment segment, accounting for 11 percent of manufacturing, rose by an annual 25.6 percent.

Output of the food, drinks and tobacco segment, which made up 14 percent of manufacturing sector output, climbed by 13.7 percent. Output in the January-August period rose by an annual 6.1 percent. Month on month, output edged up a seasonally and working day-adjusted 0.1 percent.

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Forum on German-Hungarian economic relations in Berlin

germany hungary

Hungary must continue to provide the most competitive environment for investors in Europe, Péter Szijjártó, the minister of foreign affairs and trade, told a forum on German-Hungarian economic relations in Berlin on Monday.

Although Europe is facing the threat of economic recession, the Hungarian government is not giving up its goal of maintaining the most competitive investment climate in Europe in taxation and other fields, Szijjártó told the forum held on the occasion of Prime Minister Viktor Orbán’s visit to Berlin.

In this spirit, the Hungarian government continues to reject the idea of the global corporate minimum tax, whose introduction would bring about a 6 percentage point increase in Hungary’s corporate tax rate, he said.

Minister of Technology and Industry László Palkovics said that the government “really dislikes” the extra profit taxes and introduced them only out of necessity. He added that these taxes do not discriminate against foreign-owned companies and would be phased out as soon as possible.

Hans-Peter Kemser, head of the BMW plant being built in Debrecen, in eastern Hungary, said the conditions in the city were ideal for building and operating the German carmaker’s “most modern factory”.

“BMW’s future starts in Debrecen,” Kemser said. The plant represents “a completely new approach”, not just in terms of what it will produce, but also because it will run exclusively on energy generated from renewable resources, he added.

Szijjártó said Hungary was the “flag bearer” of the “revolutionary” transformation of the auto industry. He noted that Debrecen will also be home to Chinese battery maker CATL’s manufacturing plant.

Since 2010, Hungary has emerged stronger from every crisis it has experienced, Prime Minister Viktor Orbán told an economic forum in Berlin on Monday, details HERE.

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Hungary and Uzbekistan would like to start cooperation in the defence industry

Hungary Uzbekistan cooperation

Minister of Technology and Industry László Palkovics held talks with Uzbek Deputy Prime Minister Jamshid Khodjaev on prospects for industrial and defence industry cooperation in Zalaegerszeg on Saturday.

Khodjaev, who holds the investment and innovation portfolio in the Uzbek government, has arrived in Hungary to make preparations for the Uzbek president’s visit to start next Monday, Palkovics said after the talks. The minister escorted the Uzbek deputy premier to the local test track for autonomous vehicles and the Rheinmetall armed vehicle factory.

The site of the meeting was chosen with a view to paving the way for cooperation in vehicle manufacturing and the defence industry, Palkovics said, adding that Hungary is prepared to share its experience in developing an industrial ecosystem that is similar to the environment of the test track.

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The biggest Hungarian steelworks needs immediate governmental help

Dunaferr steelworks

The government is looking into rescuing the ISD Dunaferr steelworks in Dunaújváros, in central Hungary, the minister of technology and industry told a press conference in the town on Friday.

László Palkovics said the plant was the victim of a “botched privatisation” which resulted in “uncertainty as to who the real owner is” and left the plant without a legitimate leadership.

Palkovics said he will submit a proposal at next week’s cabinet meeting regarding the resources necessary to support the group of companies running the plant. Based on operation costs, he said 5-10 billion forints (EUR 12-24m) could suffice to keep the works operating for two months, although the company also faces multiple liquidation procedures, he added.

Budapest railway
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Hungary’s car industry output up 13 pc in first seven months of 2022, says minister

audi hungary

Output of Hungary’s automotive industry rose by 13 percent to 6,600 billion forints (EUR 16.2bn) in the first seven months of the year, the minister of foreign affairs and trade said on Tuesday, adding that there was a “realistic chance” that the sector’s output could reach 10,000 billion forints “in spite of the recession environment”.

Addressing the inauguration of Audi Hungaria’s expanded tools plant in Győr, in north-west Hungary, Péter Szijjártó said Hungary had clearly become a European centre of auto industry modernisation.

The government is supporting the 3.8 billion forint expansion of Audi Hungaria’s tools plant with a 1.2 billion forint government grant, he said. The expansion has increased the base’s exclusive series production capacity by 30 percent, he added.

Output of Hungary’s automotive sector came to 9,300 billion forints last year compared with 3,600 billion in 2010, Szijjártó said. The sector employs 150,000 people, with 90 percent of its output produced for export, making Hungary the world’s 19th largest auto exporter, he added.

Germany is Hungary’s biggest trading partner, he noted, adding that bilateral trade turnover came close to 60 billion euros last year. “Looking at the figures from the first half of this year”, trade turnover in 2022 could exceed last year’s, he said. German businesses remain the biggest investor community in Hungary, employing some 300,000 Hungarians, Szijjártó said.

Hungary’s economy grew by more than 6 percent in the second quarter of the year, thanks in large part to the government’s pandemic response measures aimed at preventing unemployment, Szijjártó said. Thanks to the government’s investment promotion scheme, the Hungarian economy is still growing, he said, adding that investments were also the key to future growth.

Szijjártó said Europe was threatened by “deep economic recession”, and the continent was also facing a security crisis.

But Hungary, he said, had been “facing different crisis situations practically for 10-12 years”, adding that the country had emerged stronger from every difficult situation.

He said Hungary’s responses to the various crises had always differed from those of the international mainstream and had focused on the enforcement of national interests.

Will Hungary produce railway vehicles in the future?

Budapest railway

The state has probably let go of its cherished dream of 10 years about reviving the Hungarian domestic railway vehicle production. At least that is what can be deduced from Dávid Vitézy’s Facebook post. He announced an international tender for the largest purchase of vehicles in recent years.

IC+ project

In 2010, the government announced that its goal is “to restart the traditional Hungarian railway vehicle production” and the development of modern railway vehicles (railway cars, metros, etc.). They got EU funding for the project, 462 million HUF (1,15 million EUR), and developed prototypes by 2013. These trains’ maximum velocity was 200 km/h. While the project was growing and producing other types of vehicles as well, the IC+ coaches got full permission in 2016.

They announced that the Hungarian government allocates 30 billion HUF (74.36 million EUR) for the production of 100 IC+ coaches for the period between 2016 and 2019.  The reason for the complaints was the price because for the same amount Siemens already sold better vehicles by then. The humour of the story is that the most expensive parts of the Hungarian products were ordered from Siemens.

Due to workforce shortage, production fell and the IC+ project was halted. This caused a huge shortage of cars in recent years at MÁV-Start – the subsidiary of MÁV Zrt. (Hungarian State Railway), which performs passenger transport duties – which continues to this day.

Importing railway vehicles

In the following years, Hungary would acquire 380 high-speed (230 km/h) Intercity railcars and 50 control trailers, and also because of a previous tender, 50 Siemens Vectron-type electric locomotives. For the latter, the government will spend 70 billion HUF (174.35 million EUR), but in case the currency will continue to be weak, they might not be able to afford all 50 vehicles.

Buying all planned trains would be way over the budget for Hungary, so the government came up with a new solution. The railway company would not order the carriages from the vehicle manufacturer but only service packages. In the short term, this is significantly cheaper than buying the cars from MÁV-Start, but in the longer term it will be terribly expensive, writes HVG. Especially, if the forint will further deteriorate.

The new trains will probably start to operate at the end of 2024, or more likely only in 2025.

Hungary’s industrial output grew 4 percent in July, current account deficit huge

diósgyőr miskolc chocolate factory

Hungarian industrial output grew by an unadjusted annual 4 percent in July, quickening from growth of 1.5 percent in the previous month, the Central Statistical Office (KSH) said on Friday. In the meantime, Hungary’s current account posted a deficit of EUR 1.673 billion in July, more than double the 806 million deficit in June, the National Bank of Hungary (NBH) said on Wednesday.

Industrial output

Adjusted for the number of working days, July output was up 6.6 percent. Month on month, output grew by 1.1 percent, based on seasonally and working day-adjusted data. Output of the automotive industry, Hungary’s biggest manufacturing sector, increased by an annual 16.6 percent, and was up 2.9 percent from the previous month.

Output of the computer, electronics and optical equipment segment rose by 14.4 percent year on year. The food, drinks and tobacco segment rose by an annual 7.4 percent. In the January-July period, output increased by 4.9 percent from the same period a year earlier.

Current account deficit

Hungary’s current account posted a deficit of EUR 1.673 billion in July, more than double the EUR 806 million deficit in June, the National Bank of Hungary (NBH) said in a release of preliminary data on Wednesday.

The trade balance was EUR 908 million in the red in July, resulting from an EUR 1.490 billion deficit in the trade of goods and an EUR 582 million surplus in the trade of services. The primary income balance showed a deficit of EUR 635 million, as investors repatriated EUR 449 million from direct investments. Capital transfers from the European Union came to EUR 301 million.

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Bosch building EUR 10.6m engineering centre in W Hungary

bosch

German engineering giant Bosch is building a 4.2 billion forint (EUR 10.6m) engineering centre in Zalaegerszeg, in western Hungary, the minister of foreign affairs and trade said on Monday.

The investment that will create 200 advanced-skill jobs is receiving a 1.2 billion forint government grant, the foreign ministry cited Péter Szijjártó as saying at the groundbreaking ceremony. The engineering centre is expected to be completed in 2025, he said.

Bosch will use the engineering centre to carry out developments and tests related to autonomous driving, Szijjártó said.

He noted that Hungary is the third country in the world, besides Germany and China, to house plants from all three premium German car makers, adding that other top German companies also considered Hungary a key location for research on autonomous driving.

Szijjártó said

the goal was to get the Hungarian economy to shift from the ‘Made in Hungary’ era to the ‘Invented in Hungary’ era.

audi
Read alsoAudi to build new electric engine plant in Hungary

Hungary has become a leader in the European electric vehicle industry, thanks in part to having the lowest corporate tax rate and the government’s refusal to treat the question of energy supply as a political or ideological issue, he said.

Szijjártó said German companies were still the largest investors in Hungary, noting that bilateral trade turnover hit a new record last year and grew by 8 percent in the first half of 2022 to exceed 32 billion euros.

33 years ago today, Hungary tore the first hole in the Iron Curtain - PHOTOS 2
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In the largest investment ever in Hungary: Chinese battery manufacturer to invest EUR 7.5bn

Chinese battery maker CATL Hungary Debrecen

In the largest investment ever in Hungary, Chinese battery maker CATL is spending 3,000 billion forints (EUR 7.5bn) on building its second European manufacturing plant, in Debrecen, in eastern Hungary, the minister of foreign affairs and trade said on Monday.

One of the five largest greenfield investments in Europe in the past decade, the project will create some 9,000 jobs, Péter Szijjártó told a press conference in Debrecen at the signing of the land purchase agreement. The investment is set to receive government funding, with the details to be worked out in the meantime, Szijjártó said.

Batteries are in high demand as the three premium car manufacturers, Audi, BMW and Mercedes, all have factories in Hungary, he noted.

Hungary has secured the two largest investments ever brought to the country in spite of the current challenging economic environment, he said. “Energy prices are irrationally high, inflation is in the double digits in most countries, and the European economy is facing a recession while the world is on the brink of a food crisis,” he said.

The car industry has grown 2.5-fold in Hungary since 2010, with its production value hitting 9,500 billion forints in 2021, he said.

Hungary’s policy of opening up to the East, which came under “vicious attack”, has been vindicated, he said. “We have made clear that we won’t exclude any nation’s companies with hollow excuses. Our foreign policy and our ties with the world to the east of us are based on mutual respect,” he said.

CATL’s investment will help Hungary to emerge from the current crisis stronger, he said.

Meanwhile, Hungarian-Chinese bilateral trade grew a record 11 percent last year, hitting 12 billion dollars for the first time, he said. Growth was at 7 percent in the first half of 2022, too, he said.

“Hungary profits exceedingly highly from its pragmatic cooperation with the People’s Republic of China … based on mutual respect,” the minister said.

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Roads planned to be revamped in Hungary revealed

Hungary, road, workers, worst

Hungary’s public road maintenance company Magyar Közút plans to revamp over 1,000km of roads by the end of this year, the company said on Friday.

A comprehensive revamp of some 523km of mostly secondary roads has already been completed and work is under way on another 492km, the statement said. The projects involve not only replacing the road surface but also strengthening or rebuilding the foundation layers where necessary, tidying up roadside ditches and water furrows and renewing road markers and signs where necessary.

The company has drawn central budget and European Union funding for the work.

Hungary’s industrial output grew

Industrial output adjusted for the number of working days grew by an annual 4.8 percent in June after an increase of 3.4 percent in May, according to a second reading of data the Central Statistical Office (KSH) published on Friday. Unadjusted output was up 1.5 percent, slowing from 9.4 percent in May. Output of the automotive industry in June, Hungary’s biggest manufacturing sector, grew by 2.9 percent year on year.

The detailed data show output of the computer, electronics and optical equipment segment increased by an annual 4.9 percent. Output of the food, drinks and tobacco segment increased by 9.3 percent. Month on month, output in June rose by 0.6 percent based on seasonally and working day-adjusted data. In January-June, industrial output grew by an annual 5.1 percent. Industrial sales rose by an annual 4.4 percent in June. Export sales increased by 2.7 percent and domestic sales by 7.1 percent. In absolute terms, industrial sales were worth 5,827 billion forints, with exports accounting for 61 percent of the total.

After the release of data, the ministry of technology and industry noted that industrial output grew by 5.1 percent in the first half of the year. Compared with output in the same period of 2020, there was a 6.3 percent improvement, meaning that a new record level was reached on the back of sustained growth in the index since coronavirus came to the fore.

The performance, the ministry said in a statement, was largely thanks to government measures aimed at protecting the economy based on encouraging job-creating investments which have led to the establishment of new production capacities in Hungary. Electrical equipment manufacture and the food industry fuelled the growth, while vehicle manufacturing — in the doledrums throughout Europe — has seen nascent growth in Hungary, the statement added.

The data are robust in international comparison, exceeding the EU average and countries of the region, the ministry said. Output “has not yet seen a decline similar to that which emerged due to the coronavirus, despite the war and supply disruptions,” Zsolt Kutnyánszky, the state secretary for industry and the labour market, wrote. Hungary is turning into a key base for battery manufacturing, and is investing in 5G, artificial intelligence and the hydrogen economy, he added. He warned, however, that “various global challenges and uncertainties” warranted caution as regards the future outlook.

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